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Calculating Deferred Tax Asset Balance On December 31, 2020, Delta Inc. recorded $56,000 of deferred revenue (a liability) on customer deposits received in advance of
Calculating Deferred Tax Asset Balance On December 31, 2020, Delta Inc. recorded $56,000 of deferred revenue (a liability) on customer deposits received in advance of the satisfaction of performance obligations. However, this amount is taxable in 2020 when cash was received. Assume a tax rate of 25% and pretax GAAP income of $320,000 for 2020. a. Determine the GAAP basis of deferred revenue on December 31, 2020. Deferred Revenue (GAAP basis) $ 0 b. Determine the tax basis of deferred revenue on December 31, 2020. Deferred Revenue (tax basis) $ 0 c. Determine Delta Inc's deferred tax asset balance on December 31, 2020. Deferred tax asset balance $ 0
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